Marcus Enterprises began in 2011 when Damien Marcus invested $8,000 in exchange for capital stock. The following is the work sheet for the company at the end of the first year in business. 7. Prepare an income statement, retained earnings statement, and classified balance sheet for Marcus Enterprises for the year ended December 31, 2011.
Solution
Income Statement of Marcus Enterprises for the year ended 31 st December 2011
Particulars
Amount
REVENUE
Fees Earned
59,500
Wages Expense
(19,000)
Rent Expense
(7,000)
Depreciation Expense
(3,500)
Profit before Tax**
30,000
Balance Sheet of Marcus Enterprises as on 31 st December 2011
Liabilities
Amount
Asset
Amount
Capital Stock
8,000
Cash
25,000
Dividends
(2000)
Account Receivable
7,000
Profit before tax**
30,000
Supplies
1,000
Equipment
18,500
Accumulated Depreciation on Equipment
(3,500)
Accounts Payable
11,000
Wages Payable
1,000
Total
48,000
Total
48,000
Retained Earnings Statement:
Retained Earnings As of 1 st Jan 2011
Nil
Add : Net income for the year Ended 31 st December 2011
30,000
Less Dividend Paid to Shareholders
2,000
Retained Earnings as on 31 st December 2011
28,000
.
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Marcus Enterprises began in 2011 when Damien Marcus invested $8-000 in.docx
1. Marcus Enterprises began in 2011 when Damien Marcus invested $8,000 in exchange for capital
stock. The following is the work sheet for the company at the end of the first year in business. 7.
Prepare an income statement, retained earnings statement, and classified balance sheet for
Marcus Enterprises for the year ended December 31, 2011.
Solution
Income Statement of Marcus Enterprises for the year ended 31 st December 2011
Particulars
Amount
REVENUE
Fees Earned
59,500
Wages Expense
(19,000)
Rent Expense
(7,000)
Depreciation Expense
(3,500)
Profit before Tax**
30,000
2. Balance Sheet of Marcus Enterprises as on 31 st December 2011
Liabilities
Amount
Asset
Amount
Capital Stock
8,000
Cash
25,000
Dividends
(2000)
Account Receivable
7,000
Profit before tax**
30,000
Supplies
1,000
Equipment
18,500
Accumulated Depreciation on Equipment
(3,500)
Accounts Payable
11,000
3. Wages Payable
1,000
Total
48,000
Total
48,000
Retained Earnings Statement:
Retained Earnings As of 1 st
Jan 2011
Nil
Add : Net income for the year Ended 31 st
December 2011
30,000
Less Dividend Paid to Shareholders
2,000
Retained Earnings as on 31 st
December 2011
28,000
Particulars Amount
REVENUE
Fees Earned 59,500
Wages Expense (19,000)
Rent Expense (7,000)
Depreciation Expense (3,500)
Profit before Tax** 30,000
